Spring Manufacturing Company makes two components identified as C12 and D57. Selected budgetary data for 2022 follow: Finished Components C12 D57 Requirements for each finished component: RM 1 10 pounds 8 pounds RM 2 0 4 pounds RM 3 2 pounds 1 pound Direct labor 2 hours 3 hours Product information: Sales price $ 160 $ 250 Sales (units) 12,000 12,000 Estimated beginning inventory (units) 400 200 Desired ending inventory (units) 300 200 Direct Materials Information RM1 RM2 RM3 Cost per pound $ 6 $ 4.50 $ 0.50 Estimated beginning inventory in pounds 3,500 1,200 500 Desired ending inventory in pounds 4,100 1,400 2,000 The firm expects the average wage rate to be $25 per hour in 2022. Spring Manufacturing uses direct labor hours to apply overhead. Each year the firm determines the overhead application rate for the year based on budgeted direct labor hours for the year. The firm maintains negligible Work-in-Process Inventory and expects the cost per unit for both beginning and ending inventories of finished products to be identical. Factory Overhead Information Indirect materialsvariable $ 15,000 Miscellaneous supplies and toolsvariable 5,400 Indirect laborvariable 45,000 Supervisionfixed 120,000 Payroll taxes and fringe benefitsvariable 260,000 Maintenance costsfixed 18,000 Maintenance costsvariable 10,050 Depreciationfixed 71,340 Heat, light, and powerfixed 43,400 Heat, light, and powervariable 11,000 Total $ 599,190 Selling and Administrative Expense Information Advertising $ 61,000 Sales salaries 240,000 Travel and entertainment 55,000 Depreciationwarehouse 4,900 Office salaries 60,000 Executive salaries 300,000 Supplies 3,800 Depreciationoffice 6,300 Total $ 731,000 The effective income tax rate for the company is 50%.